Richard Freeman

Richard Freeman
The National Bureau of Economic Research | NBER

About

309
Publications
70,369
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23,645
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July 1973 - present
Harvard University
Position
  • Professor (Full)

Publications

Publications (309)
Article
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This paper explores the link between employee perceptions of working conditions and the desire for worker representation in Britain and the US. We find that the distribution of employee perceptions of poor working conditions is similar in Britain and the US; similar factors affect the number of perceived poor working conditions; and the perception...
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No abstract available.
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China’s emerging labor market was buffeted by changes in demand and supply and institutional changes in the last two decades. Using the Chinese Urban Household Survey data from 1989 to 2009, our study shows that the market responded with substantial changes in the structure of wages and in employment and types of jobs that workers obtained that mir...
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This paper analyzes the linkages among group incentive methods of compensation, labor practices, worker assessments of workplace culture, turnover, and firm performance in a non-representative sample of companies: firms that applied to the “100 Best Companies to Work For in America” competition from 2005 to 2007. Although employers with good labor...
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We present new comparable data on the incidence of performance pay schemes in Europe and the USA. We find that the percentage of employees exposed to incentive pay schemes ranges from around 10-15 percent in some European countries to over 40 percent in Scandinavian countries and the US. Individual pay and profit/gain sharing schemes are widely dif...
Article
Abstract Technology effects, business process development, and productivity growth are considered in the context of a single company: Wal-Mart. The starting point is the 2001 McKinsey Global Institute report, which finds that over 1995–2000, a quarter of U.S. productivity growth is attributable to the retail industry, and almost a sixth of that is...
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Using the employee opinion survey responses from several thousand employees working in 193 branches of a major U.S. bank, we consider whether there is a distinctive workplace component to employee attitudes despite the common set of corporate human resource management practices that cover all the branches. Several different empirical tests consiste...
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Gender-typical educational choices and lower rates of earnings growth, or the "glass ceiling," are widely believed to explain why older women earn far less than observably similar men. Using large panels drawn from the NSF National Survey of College Graduates and other data representative of college-educated workers from the 1990s, I search for dif...
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Many firms encourage employees to own company stock through share plans that subsidize the price at favorable rates, but even so many employees do not buy shares. Using a new survey of employees in a multinational with a share ownership plan, we find considerable variation in joining among observationally equivalent workers and explore the reasons...
Article
This paper documents the five main ways in which globalization of scientific and engineering has proceeded: (1) expansion of mass higher education worldwide; (2) growth in number of international students; (3) immigration of scientists and engineers; (4) non-immigration trips: academic visitors, conferences; (5) greater international co-authorship...
Article
Wall Street's 2007–09 implosion and the ensuing global recession highlight the crucial relationship between finance and the economy. Governments, international agencies and experts had failed to detect rising risk levels in the deregulated financial sector. The author outlines the resulting huge cost in lost jobs and likely reductions in public goo...
Article
Resumen. La implosión sufrida por Wall Street de 2007 a 2009 y la recesión mundial consiguiente han mostrado la importancia que revisten las finanzas en la economía. Ni los gobiernos, ni los organismos internacionales, ni los especialistas detectaron los peligros que acechaban en el sector financiero liberalizado. Ahorase está pagando una factura c...
Article
Résumé. L'implosion de Wall Street en 2007–2009 et la récession mondiale qu'elle a entraînée ont donné un rôle central à la relation entre la finance et l'économie. Les gouvernements, les agences internationales et les experts n'avaient pas pris conscience des risques accrus découlant de la déréglementation du secteur financier. L'auteur décrit les...
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Over the course of the twentieth century, Sweden carried out one of the most ambitious experiments by a capitalist market economy in developing a large and active welfare state. Sweden's generous social programs and the economic equality they fostered became an example for other countries to emulate. Of late, Sweden has also been much discussed as...
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The historical relationship between capital and labor has evolved in the past few decades. One particularly noteworthy development is the rise of shared capitalism, a system in which workers have become partial owners of their firms and thus, in effect, both employees and stockholders. Profit sharing arrangements and gain-sharing bonuses, which tie...
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This study examines the variation in educational outcomes across and within countries using the TIMSS mathematics tests. It documents the wide cross-country variation in the level and dispersion of test scores. Countries with the highest test scores are those with the least inequality in scores, which suggests a “virtuous” equity-efficiency trade-o...
Article
Foreign national students have come to the United States to study in increasing numbers and participated in some of the most advanced academic research efforts to date, lending enormous brainpower to the development of technological and scientific innovations that benefitted America. The students were drawn to the United States by the country's hig...
Technical Report
Immigrants have historically provided one of America's greatest competitive advantages. They have come to the United States largely to work and have played a major role in the country's recent growth. Between 1990 and 2007, the proportion of immigrants in the U.S. labor force increased from 9.3 percent to 15.7 percent. Approximately 45 percent of t...
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This essay reviews what economists have learned about the impact of labor market institutions, defined broadly as government regulations and union activity on labor outcomes in developing countries. It finds that: 1) Labor institutions vary greatly among developing countries but less than they vary among advanced countries. Unions and collective ba...
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This paper examines behavior in a tournament in which we vary the tournament prize structure and the information available about participants' skill at the task of solving mazes. The number of solved mazes is lowest when payments are independent of performance; higher when a single, large prize is given; and highest when multiple, differentiated pr...
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Many business, academic, and scientific groups have recommended that the Congress substantially increase R&D spending in the near future. President Bush's American Competitiveness Initiative calls for a doubling of spending over the next decade in selected agencies that deal with the physical sciences, including the National Science Foundation. We...
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Alex Bryson and Richard Freeman ask whether employee share ownership leads to better performance
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This working paper deals with the question how international trade can lead to economic growth. Since only technical progress can lead to sustained economic growth international trade has to accelerate the rate of technical progress to promote economic growth. Technical progress is mainly generated by the production and the use of ideas. It can be...
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This paper reports the first phase of a research project on mental health policy in Scotland that investigates the way knowledge is mobilised in the policy process. In this first phase of the project, the authors' concern has been to map the organisational domain of mental health policy in Scotland, paying attention to the form and structure of age...
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There is no abstract for this item.
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The US administration, under the leadership of President Bill Clinton and continued by successive President George Bush, decided for doubling of the budget of the National Institute of Health (NIH). The NIH budget, aimed for increased & D activity, from 1998 to 2003 increased from $14 billion to $27 billion, which in turn doubled increased real spe...
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Group incentive systems have to overcome the free rider or 1/N problem, which gives workers an incentive to shirk, if they are to succeed. This paper uses new questions on responses to shirking from the General Social Survey and a special NBER survey of workers at over 300 worksites in 14 companies that have some form of group incentive pay to exam...
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This paper uses data from NBER surveys of over 40,000 employees in hundreds of facilities in 14 firms and from employees on the 2002 and 2006 General Social Surveys to explore how shared compensation affects turnover, absenteeism, loyalty, worker effort, and other outcomes affecting workplace performance. The empirical analysis shows that shared ca...
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This paper examines how shared capitalism compensation systems - those that link employee pay to company performance - affect diverse employee outcomes. It uses two data sets: the national GSS survey that provides a broad representative view of the extent of the programs; and the NBER Shared Capitalism Project surveys of workers in 14 companies tha...
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This paper examines the relationship between shared capitalist modes of pay and shared modes of decision-making via employee involvement and related committees and between them and measures of productivity and worker well-being in two data sets: the employee based Worker Participation and Representation Survey and the California Establishment Surve...
Article
The popular image of American tech entrepreneurs is that they come from elite universities: Some graduate and start companies in their garages; others drop out of college to start their business careers. The dot-com boom reinforced the image of technology CEOs being young and brash. But, even though Bill Gates and Steve Jobs founded two of the worl...
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This paper examines cross-country differences in labour policies and practices and employee performance and attitudes toward work from a sample of nearly 30,000 employees in a large multinational manufacturing firm. The analysis shows: 1) large establishment and country differences in work practices, performance, and attitudes toward work across co...
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This paper documents the large cross-country differences in labor institutions that make thema candidate explanatory factor for the divergent economic performance of countries andreviews what economists have learned about the effects of these institutions on economicoutcomes. It identifies three ways in which institutions affect economic performanc...
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This paper summarizes new evidence from the National Bureau of Economic Research “Shared Capitalism†Project on the extent to which workers’ earnings depend on the performance of their firm or work group in the US and advanced Europe and on the impact of sharing arrangements on economic behavior. The evidence shows that: 1) a large and growing...
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We introduce a new hybrid approach to joint estimation of Value at Risk (VaR) and Expected Shortfall (ES) for high quantiles of return distributions. We investigate the relative performance of VaR and ES models using daily returns for sixteen stock market indices (eight from developed and eight from emerging markets) prior to and during the 2008 fi...
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A vast and often confusing economics literature relates competition to investment in innovation. Following Joseph Schumpeter, one view is that monopoly and large scale promote investment in research and development by allowing a firm to capture a larger fraction of its benefits and by providing a more stable platform for a firm to invest in R&D. Ot...
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Labor market institutions that safeguard workers' interests are frequently criticized on the grounds that they limit managers' ability to manage, i.e., to respond to changes in the …rm's external environment. I study how …rms with di¤erent labor market institutions respond to a migratory labor supply shock, using East-West internal migration in Ger...
Technical Report
The founders of the United States considered intellectual property worthy of a special place in the Constitution - "To promote the Progress of Science and useful Arts, by securing for limited Times to Authors and Inventors the exclusive Right to their respective Writings and Discoveries." In today's knowledge-based economy, capturing value from int...
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This study uses a 10-year longitudinal database on U.S. manufacturing establishments to analyze the dynamics of the adoption and termination of employee involvement programs (EI). We show that firms' use of EI has not grown continuously, but rather introduce and terminate EI policies in ways that imply that the policies are complementary with each...
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Before the collapse of Soviet communism, China's movement toward market capitalism, and India's decision to undertake market reforms and enter the global trading system, the global economy encompassed roughly half of the world's population - the advanced OECD countries, Latin America and the Caribbean, Africa, and some parts of Asia. Workers in the...
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This paper examines performance in a tournament setting with different levels of inequality in rewards and different provision of information about individual's skill at the task prior to the tournament. We find that that total tournament output depends on inequality according to an inverse U shaped function: We reward subjects based on the number...
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This paper assesses the claim the the US faces an impending labor shortage due to the impending retirement of baby boomers and slow growth of the US work force, and that the country should orient labor market and educational policies to alleviate this prospective shortage. I find that this analysis is flawed, by making growth of GDP the target of e...
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The problems/need for representation and participation reported by workers vary acrossworkplaces and by types of jobs. Workers with greater workplace needs are more desirous ofunions but their preferences are fine-grained. Workers want unions to negotiate wages andwork conditions and for protection but do not see unions as helping them progress in...
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Workers have responded differently to declining union density in the US and UK. US workers have unfilled demand for unions whereas many UK workers free-ride at unionized workplaces. To explain this difference, we create a scalar measure of worker needs for representation and relate desire for unionism to this measure and to the choices that the US...
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This paper argues that detailed studies of particular economies, such as Bob Gregory's work on Australia, are relevant to all of economics. The paper builds on the concept of a model species from biology to develop the notion of a model economy - one whose experiences illuminate fundamental economic issues; examines the criterion for an economy to...
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The policy debate over globalization in the past decade has largely bypassed the international mobility of labor. Restrict trade and cries of protectionism resound. Suggest linking labor standards to trade and it's protectionism in disguise. Limit capital flows and the International Monetary Fund is on your back. But restrict people flows? That's j...
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The authors gratefully acknowledge financial support from CIRANO, the National Science Foundation (SBR-93-21053 and SBER-96-18111 to the NBER) and the Fonds pour la Formation de Chercheurs et l'Aide à la Recherche (97-NC-1676 to Margolis). We would like to thank Abstract We use longitudinal individual wage and employment data in France and the Unit...
Chapter
For the last several decades, various companies have shared the benefit of corporate results with employees of the firm, using profit-sharing, gain sharing, bonuses, employee stock ownership, or stock options. All of these approaches have one thing in common: offering the worker a share in profits or stock appreciation when the company makes a prof...
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Freeman talked about the development of ideas and their impact on U.S. workers. It used to be the case that the place where new knowledge was created had an advantage in commercializing it. But Freeman argues that modern communications technologies allow new ideas rapid exposure on a world stage, where the ever-growing numbers of technically skille...
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Since unification, the debate about Germany's poor economic performance has focused on supply-side weaknesses, and the associated reform agenda sought to make low-skill labour markets more flexible. We question this diagnosis using three lines of argument. First, effective restructuring of the supply side in the core advanced industries was carried...
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Puerto Rico has an extraordinarily low employment rate for men. We document the low employment rate using Census of Population and labor force survey data and offer "the rich uncle (Sam) hypothesis" that the connection of the relatively poor economy of Puerto Rico to the wealthier US has created conditions that generate low employment. In support o...
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The main point of this article is to explore the methodological questions raised by weaknesses in international comparative work in the field of health policy. The core question is how competent learning from one nation to another can take place. The article argues that there is a considerable gap between the promise and the actual performance of c...
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The National Science Foundation's (NSF) Graduate Research Fellowship (GRF) is a highly prestigious award for science and engineering (S&E) graduate students. This paper uses data from 1952 to 2004 on the population of over 200,000 applicants to the GRF to examine the determinants of the number and characteristics of applicants and the characteristi...
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This paper develops four propositions that show that changes in the global job market for science and engineering (S&E) workers are eroding US dominance in S&E, which diminishes comparative advantage in high tech production and creates problems for American industry and workers: (1) The U.S. share of the world's science and engineering graduates is...
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Purpose – The purpose of this paper is to examine innovative union use of the internet in the 2000s and to see whether the major union innovations in the USA and UK mark the advent of “open source” union structures. Design/methodology/approach – Reviews two important innovations, www.workingamerica.org and www.unionreps.org.uk Examines how they may...
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A vast and often confusing economics literature relates competition to investment in innovation. Following Joseph Schumpeter, one view is that monopoly and large scale promote investment in research and development by allowing a firm to capture a larger fraction of its benefits and by providing a more stable platform for a firm to invest in R&D. Ot...
Article
Full-text available
This paper shows that in the 2000s unions in the UK and US made innovative use of the Internet to deliver union services and move toward open source unions better suited for the modern world than traditional union structures. In contrast to analysts who see unions as being on an inexorable path of decline, I argue that these innovations are changin...
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This study examines the economic effects of changes in a group of managerial policies, a key element of which was the switch from piece rate to time rate modes of compensation, in one of the last remaining firms in the U.S. shoe industry in the 1990s. The firm, which we call “Big Foot” (BF), entered the 1990s using a set of human resource policies...
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The Journal of Labor Research 20th anniversary symposium review of What Do Unions Do? offers a unique opportunity to examine how the claims made in the book have fared in ensuing research and to ponder what parts of the book I would change if I could. This paper responds to the 18 critical essays in the journal. It recognizes three major errors of...
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Authors Freeman and Rodgers find that the current recovery, which started in 2001, has been the worst in recent history in terms of job creation. They determine that the slow employment growth of the recovery is not attributable to the poor performance of a particular sector, nor is it concentrated in certain geographic areas. ; The authors conclud...